January 13, 2009

Dear Members of the University Community:

Please let me share with you a brief summary of the plan we sent to the Board of Regents enabling the University to revert to the state $7.5 million in appropriations this year.  This plan for the University does not include a central hiring freeze or furlough program, although units dependent upon state appropriations will be asked to look diligently at filling vacant positions based upon immediate need and financial circumstances.

The overarching principles guiding these immediate reductions include protecting student access to a high-quality student academic experience, supporting flood recovery and protection against future flood damage, protecting tenured/tenure-track faculty positions supported through the General Education Fund, and advancing the University's sustainability initiatives.

Please remember that these cuts apply to the current fiscal year and do not address the financial issues the State and University will likely face in FY2010 and FY2011.  The University must begin now to examine strategically the operating and capital needs to be budgeted over the next couple of years.  The process will consider the importance of the student experience, research and innovation, and our patient care strengths and will consider where focused growth can continue to occur as we work through the multiple economic challenges. 

In terms of the immediate $7.5 million reversion by the State, just under $7 million will come from the General Education Fund and will be distributed as follows:

*     $2.8 million from the building repair budget that would have been part of our FEMA flood recovery match this year.  This cut is linked to redeploying revenue bond proceeds to be used for the FEMA flood recovery match, and the related indefinite deferral of the Pentacrest restoration.  The University is required to provide $1 in match for each $10 received from FEMA.

*     $2.2 million from non-flood recovery capital project deferrals, cost shifts, and savings.  These include deferring completion and occupancy of the former theater space within the University Capitol Center, shifting General Education Fund support for the College of Public Health Building to other sources (the project will proceed), and deferral of the Oakdale Campus Library archives project.

*     $2.0 million from budget reductions to General Education Fund operating units, with some exclusions.  Exclusions from reduction include student financial aid, library acquisitions, utility fuel and debt service, and departments still in substantial flood recovery.  Preliminary reports from the colleges and other units indicate savings will come from personnel hiring delays, deferral of classroom and teaching lab equipment replacement, lengthening computing technology replacement cycles, and other general expense cutbacks.

The remaining $500,000 will come from non-General Education Fund units that receive state appropriations.  These units include the University Hygienic Lab, the Oakdale Campus, and a number of health science and research units.

These immediate budget revisions are being achieved without mandatory furloughs or layoffs, yet the consequence of the financial problems faced in Iowa and throughout our country may over the next several months result in far more difficult choices. That is why we must plan, organize and work extremely hard to become more efficient and focused in all that we do.

The larger economic challenges we face are one more reason to support our communities through personal service or direct contributions.  For those who are able, your support of charitable organizations that are helping with flood relief, student need-based financial aid, and vital community services for individuals and families in need would be most appreciated -- now more than ever.

The University has faced significant budget cuts in the past and has always weathered them with its fundamental mission intact.  We will do so again through the strength of our University community and the strong support we enjoy from Iowa's citizens.  I will remain in communication with our Governor, Regents and our local legislators to make sure they know our most pressing needs and so that we know directly from them the state's financial circumstances.  I thank you for your patience, cooperation, and dedication as we face the economic challenges before us and work hard to ensure the highest quality learning, discovery, and engagement.

Sincerely,

Sally Mason
President